Vince Cable, leader of the Liberal Democrats, said: “It is clear that Britain is under-performing relative to much of Europe, the USA and the rest of the world.

“It is especially unfortunate that the UK is entering an extended period of economic stagnation just as the rest of the world experiences a growth burst.”

He added that although Brexit may not have caused a “catastrophic collapse yet”, it had resulted in lower investments and consumer confidence.

The IMF’s World Economic Outlook also anticipated the global economic growth would be boosted in the short term as a result of US tax cuts.

Although, it suggested the global growth would most likely start to slow after 2022 as spending incentives caused by the US tax cuts will wear off.

The HM Treasury said: “We are building a Britain that is fit for the future by improving skills, backing innovation and investing in infrastructure to deliver a stronger economy and guarantee a better future for the next generation.”

The US was now projected to expand by 2.7% in 2018, up from the 2.3% forecast in October.

The growth estimates for euro area economies have also been higher than expected, especially for Germany, Italy and the Netherlands, “reflecting the stronger momentum in domestic demand and higher external demand” from investors.

2015 Public Finance. Public Finance is published on behalf of the Chartered Institute of Public Finance and Accountancy by Redactive Publishing Ltd. All rights reserved. Reproduction of any part is not allowed without written permission. Redactive, 17-18 Britton Street, London, EC1M 5TP